TrueUSD attestation pauses amid concerns surrounding collateral

Justin Sun-backed dollar-pegged stablecoin TrueUSD is facing difficulties with attestations for its underlying reserves.

According to data from LedgerLens, a real-time reserve balance dashboard displayed on the TrueUSD official website, during the last reporting interval the system received API errors or a non-response from the pricing source and was unable to apply a U.S. dollar value to the collateral assets for that point in time.

TUSD automated attestations | Source: TrueUSD

As a result, the system received errors from third-party systems “resulting in the sum total of liabilities being greater than the sum total of the relevant assets.”

“Commonly, over the historical operation of the system, the Balances ripcord is triggered by temporary imbalances seen in normal operations. However, the Balances ripcord can also be triggered due to an actual imbalance of liabilities and corresponding assets.”

LedgerLens

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At the time of writing, TrueUSD has made no public statements on the matter.

This is not the first instance of TrueUSD facing difficulties with attestations. In June 2023, the stablecoin temporarily halted its automated attestations due to balance discrepancies, just a week after grappling with glitches.

TrueUSD is understood to have funds supporting its TUSD tokens distributed across various locations, including federally insured U.S. depository institutions, an undisclosed Hong Kong depository institution (formerly First Digital Trust), an undisclosed Bahamian depository institution (formerly Capital Union Bank), and a Swiss depository institution.

In October 2023, a security breach involving a third-party vendor exposed sensitive client data at TrueUSD, which became aware of the incident through TrueCoin, its former service provider responsible for the company’s banking, customer, and product management. While the incident did not compromise TrueCoin’s internal IT infrastructure, it disclosed certain client information data, including names, email addresses, and phone numbers, affecting those who had joined the platform between 2018 and 2019.

Read more: Tron co-founder accused of printing TUSD out of ‘thin air’

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